Sensis confident of online advertising success

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"The winner in this market will be the organisation that can collect and organise the content most efficiently and be able to publish it in many forms," says Greg Ellis, Sensis Search general manager.Photo: Andrew Quilty

Sensis believes its ownership of content gives it a
significant advantage over rival search engines.

The internet search engine titans, Google, Microsoft and Yahoo!,
are locked in a desperate struggle for mastery of what is expected
to be a trillion-dollar online advertising market.

A win or a loss could determine the survival of the
combatants.

But Sensis, Telstra's wholly owned directory and search
subsidiary, is not worried. It believes it will emerge in the
future as the master of Australia's online market.

"The winner in this market will be the organisation that can
collect and organise the content most efficiently and be able to
publish it in many forms - voice, wireless (for handheld wireless
computers and mobile phones), PC internet and print," said Greg
Ellis, general manager of Sensis Search.

Sensis knows where every Australian lives, through its Yellow
and White Pages databases and also operates Whereis, CitySearch and
Trading Post covering media from print to mobile wireless.

"My competitors today - Yahoo!, Google and ninemsn are the top
three - cannot do all that. They do not own the information the
public seeks," he said.

"I own the copyright to my information. I collect the listings
and I put them in a database for print or digital (online) use, and
that database is my book, my brand, my copyright."

Google is growing, but it remains primarily a search engine used
by millions to find information in what amounts to a massive global
library. Yahoo! and Microsoft (appearing in Australia as ninemsn)
operate internet portals, which, they hope, will lock in
subscribers to make an audience for the advertising that feeds
their bottom lines.

Both Yahoo! and ninemsn are polishing their search engines.
Martin Hoffman, managing director of ninemsn, recently said a
search gateway would be added to Hotmail, to make the switch
seamless and to hold customers in the portal.

"But a Hotmail user is writing to a friend, not looking for a
set of tyres," says Mr Ellis, who insists that the Sensis formula
is Google and Yahoo!-proof.

"We have 4.85 million unique users a month across all of the
Sensis properties and about 100 million voice calls a year to 1234
and directory assistance. Cut that in half, to separate social
calls from business searches, and that is 50 million calls," he
said.

Wireless is the waking giant in communications. Mobile phones
already outnumber fixed lines in Australia and the carriers are
straining to expand their networks.

The GSM market is mature - analyst-speak for an environment in
which a carrier's growth depends more upon pinching customers from
competitors than on first-timers. Growth today is in mobile
broadband, called 3G (third generation) networks.

Hutchison "3", which built the first 3G system in Australia, has
done a $400 million network sharing deal with Telstra that will
involve Sensis adding broadband content to its weaponry.

Optus and Vodafone will build a shared 3G network to compete
with Telstra/3 and get into the business of selling Australians a
range of business and consumer products, ranging from weather maps
to video.

Steve Wright, marketing boss for Hutchison, said his group was
well ahead of the pack and would comfortably hold its marketing
lead, concentrating on technology-aware, cashed-up and
trend-conscious 18 to 35 year olds.

Sensis, meaning Telstra, has three wireless products ready:
i-Mode, a kind of precursor to full 3G technology, WAP, a 2G
technology that survives but is unlikely to get far off the ground,
and USSD (Unstructured Supplementary Service Data) a
proximity-based technology that runs off the back channel of
SMS.

Mr Ellis estimates that Sensis swamps the competition,
contacting about 12 million Australians a month.

"Google in Australia has about 6 million unique users, but they
are mainly looking for library-style information - Britney Spears,
Napoleon's diary or who played the Wookie in Star Wars," he
said.

"But let us be generous and say that 40 per cent of their total
searches are commercial, not library, giving Google in Australia
about 2.5 million a month. Split Hotmail out of ninemsn and they
have about 3 million, but delete the Channel Nine content and take
out the non-commercial searches and they are down to 800,000.

"But all of our 10 to 12 million unique users are commercial
searches," Mr Ellis said. "Even if you take out the print, I still
have 4.8 million on PCs, and beyond that I have wireless developing
very rapidly.

"So when you say there is a search engine war, my response is,
who cares? Users want information and you must own the content to
deliver speed, efficiency and relevance."